Businesses: Routers, shmouters

After seeing revenue growth for five quarters in a row, waning interest in the enterprise market results in a drop.

20 August 20043:50 am AEST

The worldwide market for routers dropped slightly in the second quarter, after five consecutive quarters of growth, according to a new study.

According to a report released Thursday by the Dell'Oro Group, the overall global revenue for routers declined 2 percent due to waning interest in the enterprise market. Companies apparently are reluctant to upgrade or expand their router networks, the research firm said.

However, some segments of the market performed better than others. While the overall service provider market was flat for the second quarter, revenue for high-performance routers used by Internet service providers jumped 13 percent quarter over quarter, Dell'Oro said.

"Avici, Cisco and Juniper each posted strong revenue increases in the 10gbps routers segment," Shin Umeda, principal analyst for router research at Dell'Oro Group, said in a statement.

In a conference call earlier this month, Cisco executives said they expect sales to be flat or up only slightly in the current quarter, which has traditionally been a weak one for the company.